FRIDAY, JULY 19, 1991
THE PRESENT PLAN ASSUMES THAT ALL MAJOR ON-AIRPORT FACILITIES, EXCEPT THE PASSENGER TERMINAL, WILL BE FUNDED AND OPERATED BY THE PRIVATE SECTOR WITH SUCH PARTICIPATION ENCOURAGED IN THE PASSENGER TERMINAL AS FAR AS POSSIBLE.
SERVICES TO BE PROVIDED DIRECTLY BY THE GOVERNMENT, AIR TRAFFIC CONTROL, WILL BE FUNDED AS PUBLIC WORKS ITEMS.
SUCH AS
THE PROVISIONAL AIRPORT AUTHORITY/AIRPORT AUTHORITY WILL FUND ALL OTHER WORKS, SUCH AS CONSTRUCTION, WITH THE ASSISTANCE OF GOVERNMENT EQUITY AND PARTLY FROM BORROWINGS.
IN A 'WORST CASE" SCENARIO THE TOTAL EQUITY LIKELY то BE REQUIRED FROM THE GOVERNMENT WOULD BE IN THE REGION OF $13.8 BILLION BUT IN A MORE LIKELY SCENARIO, THE FIGURE WOULD BE LOWER.
ON THE
A FINANCIAL CONSULTANCY STUDY WILL SOON START COMMERCIAL VIABILITY THE OF WESTERN HARBOUR CROSSING ΤΟ ASSIST THE GOVERNMENT IN DRAWING UP A PRIVATISATION PACKAGE FOR THE PROJECT ON A BUILD, OPERATE AND TRANSFER ARRANGEMENT.
"IN PLANNING THE IMPLEMENTATION OF THE ACP THE GOVERNMENT IS OBVIOUSLY INSISTENT THAT IT SHOULD BE AFFORDABLE,
+1 SAID THE PAPER.
"ACCORDINGLY, A LONG-TERM PROJECTION OF THE GOVERNMENT'S FINANCIAL POSITION HAS BEEN UNDERTAKEN ON THE BASIS OF THE PRELIMINARY FINANCING STRATEGY FOR THE ACP.
"FOR FINANCIAL PRUDENCE, THE PROJECTION HAS BEEN TESTED AGAINST VARIOUS POSSIBLE ADVERSE DEVIATIONS SUCH AS LOWER TREND GROWTH RATE OF THE ECONOMY, REDUCED REVENUE, PRICE ESCALATION AND INCREASED COST OF THE ACP.
"THE RESULTS SHOW THAT THERE WOULD BE A FEW YEARS OF DEFICIT BUDGETTING BUT THAT BY 1996 AT THF LATEST, THE ANNUAL GOVERNMENT BUDGET WOULD BE BACK IN SURPLUS.
"MORE IMPORTANTLY, THE FORECAST SHOWS THAT AFTER MEETING PROJECT DEFICITS, THE LEVEL OF FISCAL RESERVES (EXCLUDING RESERVES IN THE LAND FUND AND ASSUMING NO GOVERNMENT BORROWING) WOULD STILL BE MAINTAINED AT A PRUDENT LEVEL THROUGHOUT THE PERIOD UP TO 1997."
THE HONG KONG SPECIAL ADMINISTRATIVE REGION GOVERNMENT (HKSARG) WOULD BE LEFT IN A VERY STRONG STARTING FINANCIAL POSITION. THE MEMORANDUM OF UNDERSTANDING CONCERNING THE CONSTRUCTION OF THE NEW AIRPORT HAD PROVIDED ADDED CERTAINTY TO THE FINANCING OF THE ACP.
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IN SUM, SAID THE PAPER, "WITH CHINESE SUPPORT OF THE ACP AND
WITH CAREFUL FINANCIAL MANAGEMENT BY THE HONG KONG GOVERNMENT, LEVELS OF SPENDING ON THE ACP CAN BE RECOMMENDED.
THE
"THE PRIVATE SECTOR PARTICIPATION WILL BE ROBUST. PUBLIC EXPENDITURE IN OTHER AREAS WILL STILL ENJOY GROWTHI AT A REASONABLE LEVEL, THE LOW TAXATION REGIME IN HONG KONG WILL STILL CONTINUE, AND THE HK SARG WILL START IN A HEALTHY FINANCIAL POSITION."
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